Highlights
– As of the end of 2017, the accumulated prime and super prime stock in Bangkok amounted to 21,330 units, representing a strong increase of approximately 51% y-o-y. Majority of the new supply was in Prime Sukhumvit and Central Lumpini.

– In line with land scarcity and rising land prices, super prime condominium projects achieved record breaking average selling prices of THB 366,745 per sqm in 2017 while the average selling prices for prime condominiums also set a new high at THB 238,515 per sqm.

– Prime and super prime condominium market is expected to grow continuously as luxury units will continue to attract wealthy buyers. Rising mortgage rates typically have no impact on this segment of the market as a vast majority of buyers purchase with cash.

According to Knight Frank Thailand Research, moving into 2018, Bangkok’s prime and super prime condominium market is anticipated to grow continuously in the wake of increasing supply and robust demand. Developers will continue to launch new projects throughout this year as top-tier properties and high-end units in Bangkok still attract both affluent domestic and foreign buyers. The growth of already-booming neighbourhoods like Prime Sukhumvit and Central Lumpini will continue unabated. Demand is likely to strengthen since the luxury supply is still very limited and will continue to be driven primarily by wealthy Thai buyers. Nevertheless, the expectation is to see a larger portion of international buyers in the market, particularly the affluent purchasers from Mainland China, Hong Kong, and Taiwan. Average selling prices are predicted to continue rising in line with land scarcity in prime areas and mounting land prices that leave developers with little choice but to deliver high-margin luxury units to cover costs.

Market Overview
Bangkok’s prime and super prime condominium market finished out 2017 with a softening take up rate yet sustained the trend of an expanding market as well as increasing sophisticated development. All over prime areas in the city, new buildings are taking shape and trying to set the latest standard for luxury living in Bangkok. The market, especially in top residential neighbourhood like Prime Sukhumvit and Central Lumpini, experienced a jump in luxury supply and new construction. Meanwhile, key players in the market continuing to transform the Bangkok skyline in partnership with some top names in construction and architecture, building the most innovative and exquisite developments. On the demand front, Bangkok’s prime and super prime condominium market experienced a slowdown in some areas over the course of 2017 as a glut of expensive units flooded the market. Despite softening demand, the average selling price per sqm undoubtedly set a new high in line with limited land supply along main roads and areas of higher land prices.

Supply by Area Chart
Supply
From Sukhumvit to Central Lumpini and Sathorn to Riverside, the supply in the Bangkok prime and super prime condominium market in 2017 was remarkably up 135.8% and 135.7% from the previous year, respectively. A huge number of new launches and on-track market activities in 2017 were the consequences of decelerating market growth in 2016. Nevertheless, vigorous supply growth somehow conveys an important message about stronger sentiment among developers to this segment of the market. Taking an in-depth look at the prime and super prime condominium market in Bangkok, approximately 7,200 units were launched in 2017, of which 34% were in Sukhumvit, followed by 24% in Central Lumpini, 11% in Rama 4, and the remainder in Riverside, Silom-Sathorn, Phayathai, and Ratchadapisek – Rama 9 area. Ten super prime condominium projects with a total of 1,306 units were launched in 2017, a strong increase of 135.7% from 554 units in the prior year. Over the same time, new supply from fifteen projects with a total of 5,876 units entered the prime condominium market, representing an increase of 135.8% y-o-y.

Accumulated Supply of Super Prime and Prime Condominiums

Super Prime Prime
Demand
In 2017, Bangkok’s prime and super prime condominium sector witnessed a softening demand since an abundance of luxury product flooded the market. As a result of the dramatic increase in supply, average take up rate for the super prime segment dropped by approximately 14% y-o-y to stand at 67%. Meanwhile, demand for prime condominium units recorded an average take-up rate of approximately 76.5%, decreasing by a modest 2% y-o-y. Although the average take up rate slipped as a glut of expensive condominiums flooded the market, demand by the number of units sold per annum swelled for both prime and super prime segment. The former expanded notably by about 3,370 units y-o-y while the latter increased by approximately 80 units y-o-y. Furthermore, demand for exclusively high-end projects with superb locations and sophisticated specifications remain of interest; the buyers of these properties tend to purchase them for their own occupation or long-term capital appreciation.

Accumulated Supply, Demand, and Take Up Rate of Super Prime and Prime Condominiums
Super Prime Prime
Price Trend
The average selling prices of prime and super prime condominiums launched across the city hit record high in 2017, with luxury units now selling for an average of THB 302,630 per sqm. Taking a closer look at each sub-market, the study found that the average selling price per sqm for Bangkok super prime condominiums increased approximately 26% y-o-y, hitting THB 366,745 per sqm. Meanwhile, the average selling prices for prime condominiums rose to THB 238,515 per sqm, representing an increase of approximately 8% y-o-y. The strong prices were fuelled by two factors: higher land prices in prime areas and pent-up demand from buyers who held off purchasing in 2016.

Average Asking Price per sqm

Product Trend
Recently, developers not only teamed up with high-profile architecture firms and prominent construction companies but also some famous national and international artists to create an opulent residential supply while setting a new standard of luxury living in the city. Taking a closer look at current product details, building exterior design has become far more stunning, dynamic yet elegant while interior design is more unique, creative and magnificent, with superior quality materials and sophisticated furniture. For example, famous Thai and international designers’ work can be seen in the main lobby and common areas at Vittorio Sukhumvit 39, high-end Gaggenau kitchen appliances are fitted at Sindhorn Tonson, and splendid Ralph Lauren Home furnishings grace 98 Wireless. In order to march along with wealthy buyers’ lifestyles, some of the new luxury developments come up with bespoke amenities such as a manicure room, spa and massage room, hydro spa pool, and private dining room with private chef service from a five-star hotel.

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